good morning, everyone. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. federal, state and local investigators continue to search for clues in boston today, trying to figure out who planted two explosive devices near the finish line at the marathon. the fbi is leading this investigation. at least three people were killed. more than 140 were injured, some of them critically. at the white house, president obama vowed it will be a swift and thorough search for whoever planted those devices. >> we will find out who did this. we will find out why they did this. any responsible individuals, any responsible groups will feel the full weight of justice. >> scott cohen is in boston this morning and he will join us in just a moment with the latest. but first, before we do, why don't we get the market aes reaction to all of this. u.s. equity markets are coming off their worst session of the year. in fact, the dow ended at its lows of the day after concern about what was happening in

boston. all dow 30 components ended in the red. after the so-called fear of gauge, the vix index was spotted at more than 40%. and the futures this morning after these declines, you'll see there are green arrows today, making up the ground loss yesterday. right now, the dow is up by 55 points, s&p is up by 5.5. gold is the major stoep story yesterday because it was down over 6%. by the end of the day, it had fallen to two-yee lows. the metal fell by as much as 2% today before buyers emerged. it had tumbled more than 8% by the close of yesterday's session. you can see right now, it's up by about $30. back to 1390 an ounce, but it fell well below 1400 and this was a big story we were watching yesterday. oil prices this morning are down once again. yesterday they regained some of the ground they lost in the earlier session. right now, oil is down by about 22 cents to 88.49. as for currencies, the dollar recovering from two-week lows

against the yen. traders say that the risk sentiment is still shaky and gold prices will continue to have an impact, but right now the dollar/yen is at 97.92. dollar is weaker against the euro, trading just above 1.30. the u.s. ten-year at this point is yielding 1.719% and is can european stocks this morning. they're off their lows, despite some weak numbers out of germany, although you see some red arrows across the board. overnight, the markets in asia ended slightly lower, as well. you saw that the nikkei was down by 0.4%. and the hang seng was down by about the same amount. ross westgate will be joining us from london with more on the overseas markets in just a few minutes. >> okay. now let's go boston this morning. cnbc's senior correspondent scott cohen is there and he joins us now live with the latest. scott. >> good morning, andrew. still more questions than answers about what happened yet yesterday. domestic or foreign. who did it and why? but in this age of tablets and twitter, the morning paper still

is the historical record and they are out this morning in boston. this is the herald, "terror at the finish line" and "the boston globe" "marathon terror." each of these articles including scenes of a grisly event that took place a couple of blocks from here. like.

and for the runners, what was supposed to be tend of a dream turned into a nightmare. >> i thought for a quick second, is this a cannon thing, is this like a new ending? is this some kind of -- i thought it was a cannon. when the second explosion went, i knew immediately it was a bomb and everyone ran. >> the area hospitals then went on high alert. the medical workers here who are here to basically treat people coming in from a marathon were instead treating trauma and then injured were taken to several hospitals. as we said, more than 140 people injured. and now a full blown law enforcement investigation going on led by the fbi. >> this will be a combined federal, state and local effort. it will be an ongoing investigation. it is a criminal investigation that is -- has the potential -- is a potential terrorist

investigation. >> and, of course, terrorism, the operative phrase here, whether it was organized terrorist groups, whether it was a smaller group or whatever, we don't know. there have been claims of responsibility online, but authorities are suggesting to nbc news that a lot of that is background noise. it might be people who are just being opportunistic. so we will see what happens. we're still several hours away from the next press briefing at 9:30 eastern time where we'll hear more from the fbi, what they found overnight and we should point out that authorities were at an apartment building in revere, massachusetts, about 20 miles away from here. we do not know what relation, if any, there was to the incident but it was a federal search warrant reportedly that was carried out. guys. >> do we know in terms of the law enforcement investigation, there's been various reports of different -- either suspects or

questioning. how many people have been questioned thus far? are we talking about one or two people that they're actually paying attention to or is it much broader than that? >> they have not said that and they have been very careful not to say that. there are a lot of reports floating around in the immediate after malignant, as you might expect, in an event like this. and the authorities said yesterday at the press briefing that there was a lot of misinformation that was out there. they are talking to a lot of people, a lot of witnesses, which they would presumably do, looking at surveillance video and things like that. one thing that authorities -- or actually two things that authorities are looking out for, according to reporting by nbc news is an individual that was seen in the vicinity of the explosions wearing dark clothing. i have no description beyond that. and also a rental truck that apparently tried to make it into the cordoned off area towards the end of the marathon but was turned away.and, again, we don' specifically what the details are on that, but they are on the

lookout for both of those elements. >> okay. scott cohen in boston, thank you for that report. we'll be checking in with you, i'm sure, through wrought the morning for more updates on what's going on. in the meantime, let's go to the global markets report across the pond where ross westgate is standing by in london. tell us how the markets over there are doing in response to some of this news here in boston. >> hi, andrew. we're down again today. we were down yesterday, not as heavy as the u.s. markets. we had about 6% losses for the ftse 100. kind of where we've been for the morning. you can see on the dow jones stoxx 600 decliners outpacing advancers by around about 8 to 2, somewhere around that magnitude. around three quarters of a percent losses yesterday. right now, the ftse not on the session low. down 0.5%. the ibex off 0. 5%. the xetra dax off 0.5%, as well. we got investor sentiment out of

germany which was weaker than expected. that took us down to the session low. we had down nearly 1% at that point. a couple of stocks worth pointing out today, danone doing well on the global markets. strong growth in its asian baby food division leading the way higher. lvmh down 3.46%. weakness in the group's fashion and luxury leather business. the focus is still very much, of course, on what's going on with commodities. and we're just seeing spot gold at 1389. big debate going on about whether we're going to see even more technical weakness, perhaps no surprise in a slight rebound. what's worth pointing out is oil is still weaker at 99.07, 99.80. the nymex is down, again, 88.27. so there's a difference between

oil and those precious metals, as well. take a look at the debt market for you. spanish yields doing okay today. we had, again, a t-bill auction in spain. they raised the amount they needed and yields were lower than they were in march. yields on the ten-year pretty well contained. 4.73%. italian yields lower on the day, 4 .31. so right now, yes, equities are lower, but nowhere near matching the sell-off that we got in the united states towards the close last night. and, of course, barclay out performing many of the other markets particularly in the commodities space. for now, back to you. >> ross, thank you. when was london -- the subway, ross? that was not that along ago, right? do you know exactly? >> oh, gee. >> a couple years? >> june 2007. >> and madrid, a lot of european cities used to this. we had the one and that was a shocker to us at the time

because we always thought there was an ocean that would protect us. and it didn't, but in the last 12 years, we've sort of had this sense -- not complacency, but we've thwarted 10 or 12 of these. this is kind of a jar iring development. we're going to talk to some market guys about that and what else happened. but european cities and israel are used to this. but it's very unsettling in a place we know so well, especially in boston, you know. >> yeah. those two bombings were 2005, joe. i just remembered. the other thing is we've got the london marathon, as well. we've got the london marathon, as well, coming up this weekend. so, you know, there's a lot of security steps now being taken there, too. >> yeah. i don't know. is there any reason to think that, you know, marathons are now the venue for -- it could be anywhere, obviously. >> yeah. >> and even recently, i admit

there are times where the security is very tight at wherever you are and like you, we still have to do this? and now you know we're going to be back, you know, 120% with this. ross westgate, thanks. this is what we do, market reaction to things which always is uncomfortable and strange. david joy, the chief market strategist at ameriprise financial, who is in boston on set, jonathan gullah, chief equity strategist at ubs investment research, david, you're up there. this is different -- i go back to 9/11. there was airplanes. we immediately had to gauge the effect on the travel industry and everything else. let's start talking about what happened yesterday and then we have to go to the commodities market and everything else that was precede ago pace before any of this happened. but do you expect this to have

any long-term effect on markets here in the u.s., knowing, again, how vulnerable any big city is? >> my instinct tells me that the answer is no, that in economic terms i think the market, the economy at large will move beyond this relatively quickly. but at the same time, there may be some lingering impact in terms of investor sentiment. the sell-off clearly that occurred on friday and then again on monday, in my opinion, was a reassessment of the pace of global growth. important to point out that most of the weakness yesterday was already in the market before the bombings took place. but clearly, there is an impact on investor sentiment, a reminder that it's a dangerous world. and so you may see a little bit less of a risk appetite going forward. in economic terms, i think we'll move beyond it fairly quickly.

>> yeah. john, i guess you would ask, at this point, you wouldn't think that consumers would change behavior based on this. it could potentially aveng -- i don't know, whatever group you want to talk about, jonathan, restaurants or any type of tourists activities. nothing to expect at this point, do you think? >> if you said to me are consumers going to be spending time watching their tv screenes and trying to figure out what that means instead of going out doing something else, yeah, that probably has a very, very short-term impact. the reality is, this is a human tragedy. i've never run a marathon, but i can only imagine what kind of accomplishment and then something like this. the market meltdown at the through the course urs of the day and then the tank at the

end, you have a market that's falling apart and all of a sudden we realize it was something different and everyone starts calling friends and family in boston to figure out what this actually means. >> why do we think this is different than what happened beyond 9/11, beyond the sheer number of the size and scale of what happened? that has huge impacts. it was such a psychological blow. the nebs of people involved, the tragedy just felt so huge. and i don't want to diminish what happened yesterday. clearly it was a horrific situation and by the way could have been worse. one of the things we haven't focused enough on is apparently there were other bombs that don't know off. >> we don't know about that. i think part of is we're still waiting to get the rest of the information at 9:30. it's horrific, you can't believe it. but probably the loss of independence was more than anything. >> but even more than the loss of life, looking back at it, ann after 9/11, we ended up with a war in iraq, a war in afghanistan, you talked about airports, building that's we go

into, the buildings that we go into are secure. think about the hundreds of billions of dollars and the change to society and even the whole way that we in the u.s. operate on the world stage has been changed. >> fundamentally. >> fundamentally. >> but we decided for some reason -- and i know it's a quick reaction and we're less than 24 -- for some reason, this is not -- there clearly is -- >> it is self-contained. >> this can be one person. it could be a lone wolf, it could be a sell of three or four guys. what knows. >> but does it put it back on the stage in a different way? >> well, we had 12 years where we didn't think -- we somehow dodged this. >> but today, we've spent 12 years hunting bad guys. and i think that the whole -- you know, so i'm not sure, again, putting asiding the human tragedy, do we conduct our affairs as americans or a government or military differently because of this? and can we don't know that this isn't just some lunatic and there's no information here. but i'm not sure that this

changes the world the way this says. >> david, go talk about what was going on with gold in your view and with the commodities that started sort of last week and then accelerated. what was, you know, before this happened, what was going on? >> well, i think you have to go back before last week even. if you -- you know, a lot of people were paying attention to the notable divergence, if you will, between what was going on in stocks and what was not going on in commodities. especially industrial metals. they were not confirming the new highs that were being reached in the s&p on almost on a daily basis. and it was making a lot of people nervous that one or the other market was sending an incorrect message -- >> but commodities aren't necessarily correlated with equity prices, anyway, or especially financial assets or bond prices. they can move inversely. >> yes. but in this case, industrial

metals. >> in my view, it was, in this case, a message about the pace of the global economy. there was a time of complacency coming out of the sequester and coming out of the fiscal cliff that we're going to avoid the second quarter slowdown this year that people have absorbed these fiscal headwinds and said, okay, no win back. and i think that that was maybe incorrect. and now we're at least trying to reassess that. and so commodity prices i think were saying all along, don't be so sure. don't be in such a hurry to conclude there would be to impact here. and i think the markets caught up with that. >> and if you ascribed, jonathan, what people didn't think was justified, if you give credit to the federal reserve for being so easy, you would have thought maybe that that would have been reflating commodities. they should have gone along based on debasing the currency

and i don't know whether it's good that they didn't. i mean, it almost makes you feel a little better if the dollar strengthens, given what all the fed has done. i don't know if i want gold headed up over 2,000 with this. >> yeah. but if you look at the trade, we just put out a note today basically highlighting this weakness. but every single major release in the month of april has come in weaker than it was in march and weaker than -- >> is deflation back? is it something to worry about with the fed like it is? it really could do it. >> it's shocking. >> it is shocking. >> when i talk to equity guys, they're not focussing on japan. when i'm talking to global macro hedge funds, they see that all this money printing in japan is very dangerous and they actually point to, in a very bizarre way, that there's deflationary risk to access money printing if you get a capital flight out of japan, could that put the japanese banks under pressure if all of a sudden there's rising interest rates on the back of

that and is japan playing a very, you know, scary game and they're actually pointing to that as a potential reason why. and the tips market is basically telling you that there's a wave of deflation coming. >> i think the vix is partly the stock market and partly the uncertainty that comes and the fear that comes from a event like that. david joy. >> there was, if you looked at the volume on the new york stock exchange, it's pike issed at 3:00 yesterday. it tends to spike in that last hour, but by more than usual. >> you knew there was no coming back after the markets in a way. you could just stand aside. thank you. still to come this morning on squawk, we will have more on the fbi's hunt for whoever set off the two bombs at the finish line of the boston marathon. plus, we will head to chicago from the early buzz from the trading pits there. first, though, as we head to a break, take a look at the futures. after the massive losses yesterday, down by more than 260 points for the dow, you can see this morning, there are some green arrows. dow futures indicated higher by

about 47 points above fair value. s&p futures up by just over four. squawk will be right back. carfirmation. only hertz gives you a carfirmation. hey, this is challenger. i'll be waiting for you in stall 5. it confirms your reservation and the location your car is in, the moment you land. it's just another way you'll be traveling at the speed of hertz.

welcome back. if you're just waking up this morning, u.s. equity futures are indicated to open higher. you can see that we're up 19 on fair value. so the 68 or 70-point move that we've been seeing, you have to take off 20 to get to it. upward pressure of just under 50

points. more interesting might be is where gold is today. it's rebounding a little bit. but just looking at that number, 13 -- and yesterday, remember, we saw it at 1390 in the morning. we baent to 1410, 1420. and then mid day, all the way back down to 1370, 1360. after -- you can it right there. a lower highs and if you can just draw one of those technicians use, draw those two line band along there and you can see the highs are getting higher and the low res getting lower. >> and earlier this morning, the numbers were down by 2%. you're seeing this bid come in, still a gain of less than 2% after the massive declines yesterday. more than 8%. not massive bounceback. >> and you can figure some connection to what japan has been doing. i mean, if you try hard enough. basing the yen, the money leaves japan, looking for somewhere else to go and then that causes some people to sell gold.

and sell off, right? >> and cyprus, supposedly. >> it's interesting, that's the same thing people said about the shares of apple when they were selling off, that you had to sell your winners to pay for other stuff. >> if you need liquidity, you go where -- >> i think it's more japan than cyprus, don't you think? >> it's more dependent on cyprus? >> no. more japan than cyprus. >> there were rumors that cyprus was selling gold. >> i saw those rumors. >> to get it started, there were so many -- and it was pointed out yesterday, i think i was reading something from peter chip, who loves gold, that when it went up to a thousand or 1200, maybe that was all fundamentally true. but then once it went up to 1200, but then once all the investment guys that were having trouble getting returned in equities, once they saw that there was momentum there, all kinds of investment money went into it to try to chase return. >> but he was saying 1200 is fundamental? that's still down a couple hundred from where it is now. >> there were people saying 1260

people last week saying 800 or 900. >> so does bid coin track gold? >> apparently. apparently it collapsed overnight. it was down at like 57. >> you own some bitcoins, joe? >> i don't. did you -- what did you use where you were? >> we were in vietnam, so we neat vietnamese -- >> you converted to vietnamese money? >> vietnamese money. and we were in cambodia and i think, frankly, we used a credit card most of the time. >> you did. >> and we used american -- actually, in cambodia, a lot of u.s. dollars. and in vietnam, u.s. dollars were good, too. but we did convert for the most part. >> a lot of different sized paper or -- who is on the -- >> yeah, there's some different sized paper, a little bit. not huge. >> ho chi minh is on the some of the paper? >> he is. sort of a strange version of communism. >> yeah one mentioned that. >> capitalism going on --

>> well, i like you said something like you get -- you know, it was vintage sorkin. you get none of the advantages of communism, of which i didn't know there were any, but none of the advantages, but all the bad things. no advantages to communism? >> they pay for their own -- if you need health insurance, you pay for your own health insurance. if you want to go to school, you pay for school. all of the things that you would have thought come with socialism you don't get, but -- >> it was just funny because you said none of the advantages like free health care and i thought, yeah, like what we're getting here. the little version of communism that we're sort of trying to import here. >> my guide in vietnam said that we, the u.s., was more socialist than they were. >> he did? >> yes. he thoughts the benefits going on in the u.s. were much greater. >> and i'm not ready to disagree with him, certainly. >> let's get down to the cme. bob iaccino is standing by. bob, obviously, what happened yes ed we are still trying to

get our heads around, still trying to figure out. we saw the markets end at the lows of the day. but the expectation this morning, at least at this point it looks like the futures are indicated higher. is this a sense that we feel like this is a one off situation? >> well, it's a pretty sick feeling trying to figure out what to do with your positions and switching back and forth to watch the tragedy that's going on. it brings back a lot of bad feelings and a lot of bad memories. so i think a lot of us were shaken up by that and that's why you saw that spike in volume, obviously, at 3:00. anybody who was thinking that that particular two-day dip and, you know, the equities were going a lot lower before that happened. just kind of pulled out of the market. and that's kind of the sick feeling coming back from 12 years ago. but when you look at it this morning, again, it's difficult to try and figure out what the trade is going to be when something like that happens. but you do have to believe in the short-term, it's a buy trade with the goldman sachs earnings. people have expected better. the financials have done better.

if the banks can get their feet under them for the medium term, you can possibly have this fee pushed lower by the unfortunate events in boston. >> bob, it's hard to separate the trading action yesterday. things looked pretty awful, even before the news out of boston and obviously changed the entire sentiment. but when you look back at the sell-off yesterday before that news at 3:00, how were things headed? i mean, it looked like things were maybe turning around a little bit earlier in the day. >> well, you would expect this kind of a sell-off if this was going to be the correction followed by consolidation. and then followed by a decision by the market, whether it was going to continue and go back up to new highs or whether it was going to retrade that 10% or 15% that people are calling for. you would really expect that who happen over a three to five-day period, rather. last time it happened in 2011, i believe it was six down days in a row and it went sideways for a week or two. that is sort of what everybody is looking for to make decisions. and i really think the move after that is going to be lower.

i'm sticking with what i've said all year, that we're going to be up high single digits, low double digits at the ends of 2013. but right now, this sideways movement is needed. again, the excess selling that happened yesterday probably is causing the rebound this morning, probably causes a bit of roadway bound or the rest of the day. but i think you'd be hard pressed to get even 50% of it back in the course of one day. i think there has to be some sideways movement before anybody really comes in with any buying power at all. >> bob, thank you. >> thank you. coming, the fbi, homeland security and intelligence officials are going to be briefing lawmakers in d.c. today on what they know about the explosions in boston. aman is going to join us from capitol hill. >> ayman. >> it's a day of beefed up security across the country in response to the evens in boston yesterday. i'll have the latest on that as well as the massive federal response in washington when we come back.

with time shift and tblackberry balance.10 built to keep you moving. see it in action at blackberry.com/z10

but at xerox we've embraced a new role. working behind the scenes to provide companies with services... like helping hr departments manage benefits and pensions

for over 11 million employees. reducing document costs by up to 30%... and processing $421 billion dollars in accounts payables each year. helping thousands of companies simplify how work gets done. how's that for an encore? with xerox, you're ready for real business. man: how did i get here? dumb luck? or good decisions? ones i've made. ones we've all made. about marriage. children. money. about tomorrow. here's to good decisions. who matters most to you says the most about you. at massmutual we're owned by our policyowners, and they matter most to us. ready to plan for your family's future? we'll help you get there.

we've got some numbers off of blackrock. beautiful action in the last 12 months for the stock. but rough session yesterday. unclear where we're going to see a trade today after a close at 253. but the company reported 3.65. the estimate was 3.58. so 7 cents ahead. the gap revenue number is 2.45 billion versus an expectation of 2.43 billion and assets under management, they missed it by -- they almost hit 4 trillion. boy, so close. 3 3.936. >> if you have $4 trillion under

management, you could do nothing and have a good day. it's a good business. >> 3.93. korea, what are you saying, if you're taking 1% or -- >> i'm just saying, yes. if you're not taking anything, it's no good when it's someone else's money. unless you're skimming. is that what you're suggesting? >> i'm not at all. i'm just saying $4 trillion explodes. >> but they don't have 4 had, they have 3.936. >> and that would grade on lars' thinking. >> 37% operating margin reflected improvement. the company says from the first quarter when it was -- i don't know. just from 2012. so it's up from there. >> so blackrock, we'll see if we get an indication on where it's going to open up. nothing yet. >> it's interesting. he talk bes passette flows and aging populations, he said they're living longer worldwide. at the same time global monetary policies have reduced interest rates at historic lowes and now

long dated fixed income instruments which are used to fund retirement obligations. that's having a big impact on where the asset flows are going as investors seek other sources of yields, including from equities. >> yeah. >> where we witnessed a record 34 billion in net new flows. so they're seeing it there, too, just as people are kind of chasing yields. you can't do that in the old ways. >> but they're talking on 4 trillion, they're talking 34 billion. >> this is right. >> okay. let's get back to the story of the morning, the tragedy in boston. cities across the country on high alert today following the deadly bombings at the boston marathon. ayman has more from washington. >> the president was briefed overnight by homeland security advisers at the white house. he expects to be briefed later this morning by the fbi

investigators. we are expecting at about 9:30 eastern this morning, we will have a briefing for the media by the fbi in boston to let us know what they know as of this point. now, yesterday within hours of the attacks, president barack obama came out and talked to the press and he said he directed a massive federal response to the attack. >> i've directed the full resources of the federal government to help state and local authorities protect our people, increase security around the united states as necessary and investigate what happened. the american people will say a prayer for boston tonight and is michelle and i send our deepest thoughts and prayers to the families of the victims in the wake of this loss. >> now, andrew, as you can imagine, we expect to see massive security across the country at any public events or gatherings of large numbers of people, including here in washington, d.c. where they have the emancipation day parade scheduled for today. authorities here in washington say, that parade will continue

as planned, but they say there will be beefed up security for it. they call it security that you can see and also security that you can't see on the ground here in washington today as we expect to see across the country, guys. >> eaman, don't go anywhere. stay with us. we have colonel jacobs this morning. he joins us on the set. he's an msnbc military analyst. put yesterday's events in context for us in terms of the security apparatus that's gone on in this country for the past decade. as joe was saying, just about a half an hour ago, we thought we were past this. we felt that we had become -- i don't want to say complacent. >> complacent is the right word. >> we beat a lot of this back. >> if you want to fly from new york to chicago and you've got to get undressed in order to do so, it's easy to get complacent. put it in proper -- i'll give you a comparison.

in the uk, there are no public garbage cans. in london, there are no garbage cans into which you can put bombs like this. we are relaxed about this. we haven't had attacks like they have in europe and public places. >> what does this say about what we've done over the past decade? clearly the answer is maybe we haven't done enough, maybe we have, maybe things get -- you know, fall through the cracks? how do you think about it? >> people's attitudes are very much different than they used to be, but it's people themselves that have become complacent. the governmental apparatus needs to decide what it's going to focus on. there's no way you'll be able to contain any event like this, for example, or the super bowl or something like this. there is no way you'll be able to swarm the entire area with bomb sniffing dogs all the time. and so, incidents like this can happen. what is different, what is very much different here that's happened is that our

intelligence apparatus is very much better than it was before. we spent a lot of money trying to develop our intelligence capability and our ability to lisp to telephone calls and is so on. all that stuff is very much better. >> colonel, the journal puts it this way. in particular, in their editorial, an anti-terror media and legal industry has developed in recent years claiming that police tactics like preemptive sur veils is no longer necessary and al qaeda is all but defeated so we can relax. there is some question. we've said we no loerng use the war on terror as terminology and you can see how much criticism the president has come under for drone attacks. why do we still need to kill terrorists using drones? you can see how much criticism he gets for that? >> he's going to get even more criticism if this turns out to be the result of some homegrown knuckle heads who put these bombs together.

>> why would he get more? >> because it will verify the notion that we don't have to -- >> but it may not be that. it may be that it's -- you're leaning towards domestic. >> there wasn't the kind of chatter on the air waves that we've seen before. no claims of responsibility. >> it could be a -- i don't know, it could be four or five guys that are -- boston is an international state with so many universities and in the past stheef found so they've found some, you know, presumed cells, right. >> and in new york, too. there's one thing about it, it's very difficult to get high explosives like that in this country. in other countries, you can get it. >> what about the ball barings? did we hear it this morning? is that a fact? >> we heard that yesterday for a while. but you don't need ball bearings. you can put nails and nuts and bolts and -- it had the signature of an ied,

it was saying. >> oh, yeah. but think about what it takes to get this. high explosive, debt nation cord, you have to know what you're doing, too. you need a detonator and then you have to trirger it in fashion. that means to me that they were command detonated rather than being on timers. >> do you think there's a mobile -- >> yeah, it sounds like it. >> there was some debate ask controversy about whether they should shut down the networks. >> they did and then they didn't then they came out and said they didn't. >> if you did that, you would really have complaints. >> do we know yet, there were some reports that there were additional bomb that's did not go off. do we know anything about that? >> we all heard that there were and then it was denied that there was an additional bomb. the thing over kennedy library was an incendiary device, but

evidently it was not. >> but they fully detonated other ones? >> that's what i'm told. it's not been verified by whom i trust. but the fact that you had two of them in quick succession indicates at least two people. because you're not going to have one guy carrying around two bombs. >> carol, real quick, the way away of the morning, how much does this exchange the conversation going forward? >> i don't think it changes it at all, essential not in terms of the market. this is not like 9/11. there is not going to be any lasting immateri ining imprint. we're not going to stop permitting people to congregate in public. >> is it going to change the way we approach some of these eaches? >> i don't think so. maybe more dogs. take away the garbage cans. >> right. >> cordon off areas, more security. it's not going change the way we live. >> there is still -- it's going recently to whatever event you're at, you still are struck

by how much security they bring. >> but not enough, is there? >> well, there's never enough in a free country. >> unless you're going to stop being a free country where everybody is going to get his own individual cop following him around going through his luggage. >> thanks for coming in. appreciate it. if you are just waking up this morning, let's bring you up to speed on where the markets are indicated. u.s. equity futures are going to open -- if they were right now, they would be up about 55 points. we would focus on commodities, which have been the story for the last week or so when "squawk box" returns.

good morning, everybody.

gold prices rebounding at this point after falling. you can see they are up by 2%. this comes after a loss of more than 8% yesterday. still below 1400 an ounce for gold. when we come back, we'll talk currencies and commodities. stick around. come on, nowadays lots of people go by themselves.

no they don't. hey son. have fun tonight. ♪ ♪ back against the wall ♪ ain't nothin to me ♪ ain't nothin to me

[ crowd murmurs ] hey! ♪ [ howls ] ♪ arrival. with hertz gold plus rewards, you skip the counters, the lines, and the paperwork. zap. it's our fastest and easiest way to get you into your car. it's just another way you'll be traveling at the speed of hertz.

>> welcome back, everybody. we've been watching some of these major moves in

commodities. joining us is mark grant from southwest securities. and adrian is chief asian and emerging market strategies analysts. matt, let's start off talking about gold. we were just having the consideration around the table. why yesterday? what caused all of had? and do you think this continues? >> sure. uncertainty caused by such a tragedy it was only natural we saw huge amounts of selling in gold and across commodities. however, as the panic eased overnight -- >> wait a second. this all happened before the boston marathon. >> commodities have been absolutely clobbered whether it was related to cyprus or recommendations by banks getting out of certain commodities. but we have seen an absolute

bludgeoning going on. >> $1400 yesterday morning, about 24 hours ago, long before we knew what was happening in boston. what happened to spark that? >> it's just a flight from commodities, generally an absolute flight out of those in terms of -- i looked more specifically at oil. so from that perspective we've seen the fundamentals weakening. we have seen selloff. in terms of gold, just pointing. and now support coming back in. >> mark, what do you think happened? >> my take is different. somebody got in trouble. it may have been cyprus, portugal, greece. it may have been a hedge fund. we saw the largest drop in gold in two days in 30 years.

we saw tre were men douse volume. to me it indicates somebody is in trouble. we see a little bit of trouble this morning. >> who? >> we never knew. for a little while. we have seen this movie before, right, mark? >> absolutely. we'll find out in four or five days. the other thing that fed into this, joe, was tremendous amount of margin first in gold and then in the equity markets. it all fed together in some kind of freeding frenzy. >> one with of the things is maybe what the bank of japan is doing. do you think that's cause for what's happening in the selloff in gold? >> i think this is a fundamental stories in commodities. but specifically in gold pay attention to what's happening in

india. in february, if you wanted to buy more than 1,000 u.s. dollars worth of gold you have to provide your income tax number. india say major buyer of gold. it is discouraging unaccounted for money moving into gold. i think with regards to commodities, there's a lot of uncertainty about chinese economic growth. if you look at steel production, cement production, it's barely growing in china. residential construction starts last year were down 11%. so i think there's a fundamental issue with commodities. they probably moved lower. there are assets much more interesting than commodities.

>> mark, if this is a situation where as you suspect this is someone got in trouble, what happens to prices from here. >> well, if we go back down again and we have a big increase in margin calls again and then money has to be raised in the equity markets to offset losses in gold, then you're going to go down somewhere under you're going to rely on the margin. and cme released yesterday. >> anybody who says that deflation is once again on the table may have nothing to do with that whatsoever. >> i think you're right.

i think someone or somebody or some large institution is in trouble. we'll find out who that is. and you can tell this because of the tremendous volume and the big rise that took place yesterday. >> china is a little weaker. it had been falling for months. it gets to a point where it's a tipping point for someone who is in trouble. then it looks like there's fundamental reasons. and it may not be at all. someone got a margin call. someone big. >> that's right. i think you're right. >> mark, matt, adrian. gentlemen, thank you very much. >> we are approaching the top of the hour. a live report from boston at the site of yesterday's bombings coming up next >> plus, all-star lineup ready to talk about what's going on in the market and what all this means. stay tuned for that. ♪

(train horn) vo: wherever our trains go, the economy comes to life. norfolk southern. one line, infinite possibilities. ♪ here we are, me and you ♪ on the road ♪ and we know that it goes on and on ♪ [ female announcer ] you're the boss of your life. in charge of making memories and keeping promises. ask your financial professional how lincoln financial can help you take charge of your future. ♪ ♪ oh, oh, all the way ♪ oh, oh i know what you're thinking...

transit fares! as in the 37 billion transit fares we help collect each year. no? oh, right. you're thinking of the 1.6 million daily customer care interactions xerox handles. or the 900 million health insurance claims we process. so, it's no surprise to you that companies depend on today's xerox for services that simplify how work gets done. which is...pretty much what we've always stood for. with xerox, you're ready for real business.

terror in boston. official search for answers as to who and why after two bombs leave 140 injured and three dead. commodities meltdown. a look at yesterday's selloff. and what traders will be watching this morning. earnings from coke, johnson & johnson and goldman sachs as second hour of "squawk box" begins right now. good morning and welcome back to "squawk box". let's take a look how the futures are setting up after the

tragedy in boston yesterday. you can see it there. dow looks like it will open higher, 47 points higher. s&p up as well. three and a half points on the nasdaq up over eight points. we are about two and a half hours away from the next update from law enforcement officials. on monday's explosions at the boston marathon. three killed and 140 injured in two separate explosions. president obama promising all resources will be employed during the investigation. >> we will find out who did this. we will find out why they did this. any responsible individuals, any responsible groups will feel the full weight of justice. scott will join us in a minute from boston. the worst one-day losses of 2013. in corporate news, coca-cola is

among the company's set to release numbers. analysts looking for coke to post 45 cents per shares on revenue of 10.9. we're expecting numbers at the bottom of this hour. and consensus forecast calls for $3.88 share on revenues of $9.7 billion. goldman also expected that coming around 7:30 eastern time this morning. a busy morning for economic numbers. march figures for housing starts and consumer prices at 8:30 eastern. consumer prices will drop 0.8. let's go back up to boston and get the latest from our scott cone on the investigation into what happened yesterday.

scott joins us from boston. hey, scott. >> good morning, joe. on what should be a festive morning, the day after marathon day where people bask in their achievements. all of that destroyed by two bomb blasts, 12 seconds, a block apart 2:50 yesterday afternoon or thereabouts. as you said, 140 people plus injured. three dead. they include an 8-year-old boy, martin richard who was there to see his father run the race and reportedly two other family members among the seriously wounded in yesterday's blast. i want to bring in brenda mcdonald here from nova scotia. you were a couple blocks away when this happened. tell me what you saw and what you experienced. >> we came up boylston street, you're getting the last bit of adrenalin. we saw the first blast.

we thought it was celebratory, somebody certainly across the finish line. and then the second we realized something is not right. we were all turned around. the amount of police and security that were there pushing us back away from the run towards the finish line. and we just kept moving. and everybody just kept moving. they kept us to the middle of the road. the fire department was right there, so they responded quickly. and it was just staying out of the way. >> this is your fourth marathon. >> my fifth. >> so you're accustomed to the security that normally is attended here. are you surprised somebody was able to get away with this nothing what you know how the finish line is always set up? >> it's always secure and felt a lot of attendants around. it makes you question was it there before the race started, in the evening.

nothing was told about it being there. it's very scary that happened. and we're seeing, as we have been saying, a big police presence and a long line of motorcycle officers. we're not sure what that is about. brenda, your time is slower than normally be because of surgery. that may have been a life saver for you. >> yeah. i didn't train the way i would typically train so i came in a little bit later. my two friends crossed the finish line before me. and i made one stop to the washroom, which i don't particularly do on a run. that came into my mind last night when we were watching the scope of what was going on out the window. because we're right on the finish line. but you have to come back to the families who were impacted who were there innocently watching

that race and out of nowhere that happening to them, which was very scary. >> thanks very much for taking the time to talk to us. a horrific scene no tkobt yesterday. as you can see, just a huge presence as they try and figure out what happened. >> scott, still a lot of questions. news break is coming up 9:30 later this morning. but a lot of questions ahead of that. >> the markets were already nervous yesterday. you saw major selloffs. gold with its biggest one day drop ever. the last 30 years. joining us right now to talk more about it from the cme is michael. tim freeman the. and wilbur ross, chairman and

ceo of w.l. ross and company. this is a situation we were trying to get our arms around what was happening before the incident in boston yesterday. we walked in and saw unbelievable drops in the gold price. he said maybe somebody got into trouble in the gold market. what do you think happened? >> i think there's been a lot of speculation on margin. there might have been margin calls that contributed to it. i think gold is a psychological phenomenon. >> were you surprised to see gold at the levels it got up to. >> yeah. but to me it can go anywhere. no more rhyme or reason for it to be at 1600 than 2,000 or 100. >> what people will tell su currency are based on whether central banks are being prudent.

it's all emotional. >> it's always been psychological. >> the other move we watched is what was happening with equities. that drop of 265 for the tkau was the biggest drop this year. >> right. >> do you think this was a correction waiting to happen or people are really looking around the globe saying hold on a minute. >> i think people are suddenly starting to realize that maybe top line growth isn't there. if it isn't, the big gains will have to slow down. you can't cost cut your way forever and ever. >> do we not have the fed put? >> i think the truth is that with quantitative easing it is less affected than the prior

batch because so much has been brought in. >> but double it. >> we're already there, aren't we? >> have you already -- >> punishing them. they have been borrowers over savers for quite a time. it is literally to say, no, your count was down each month. >> tim, what do you think? is this a one off blip, a correction that is going to see its course? what happened? >> we can look at it a couple of different ways. it screams there's a seller out

in the markets that significantly overweighs the buyers. i think we certainly need to look at central banks. there are gold reference. they will certainly talk to and reference cyprus and the fact that part of their package they may have to sell gold returns and people in the eu, any type of boiler plate policies that are used say in spain. investors will think about that when they look at the gold reference. that is the type of potential seller that would make people start to question their positions. to wilbur's point, they are marginally involved in investors, you know, any sort of down trade in the market will be exasperated. >> do you think the correction is over or it's not? is there more to come? >> i'm not a gold expert.

it is very much a confidence sort of animal. we look at what the bank of japan has done and the bid in bonds both in spain and here in the u.s. to tie a team, to me it's a little stretched and we have to see more data come in. most people are looking at the china data and the softening of the economy. if you look at fear gauges and the tragedy in boston, it speaks to that. vix was a little bit higher. we have basically been moving lower and lower. it's very much a wait and see attitude and seeing how earnings are coming in and reassess the market. we may very well look at a 1.5 to 1.70. and your investment opportunities will continue to be equities.

and i think the theme in equities will be central banks will continue to stimulate. we won't lose that put any time soon. i think it would be significantly lower by the end of the week. it's a very retail product at times. the volumes were very high. >> and people who buy on the dip today. >> we saw it prior to boston. we did start the base around that 15.53, 15.52 in futures. >> there's nowhere else to go. people don't believe the economy will be as bad as others. >> i think the economy may not be as bad as people think and there's no other place to go. >> what's the mood there? it's still early. you have to be getting your thoughts in early as you walk in the cme this morning.

>> many people anticipated somewhat of a rebound. clearly you thought gold was going to see some sort of bounce here. it's a very risky asset at this point. it's not ae haven. the first thing we looked at off this news is how the dollar traded. and you saw strength against the euro. most being stirling. you are start as more astute investors are looking a little bit more because they anticipate the slope where it's at. the biggest news of the day was the economic news out of china. there is going to be a slowdown

that moves from europe into china. that is starting to look like that's the case. >> although we got bad numbers out of germany and the market didn't really really significantly to that. >> it didn't. that's not surprising. one of the things about germany we're starting to look at is the periphery around it. what time of reserves do these have as a boiler plate. the reason why we're talking about germany in particular is the fact that is still the leader and we are seeing this slowly eek its way out with an irish scenario. we see the confronting immediately. >> tim, thank you for coming in to be on set with with us. wilbur will be with us the rest of the program.

he's our guest host today. >> pantheon chief economist will talk china narcotics global markets and more. and numbers from coca-cola, johnson & johnson and goldman sachs. we continue to search for answers for yesterday's events in boston. everyone's retirement dream is different; how we get there is not. we're americans. we work. we plan. ameriprise advisors can help you like they've helped millions of others. to help you retire your way, with confidence. ♪ that's what ameriprise financial does. that's what they can do with you. let's get to work. ameriprise financial. more within reach.

all stations come over to mithis is for real this time. step seven point two one two. verify and lock. command is locked. five seconds. three, two, one. standing by for capture. the most innovative software on the planet... dragon is captured. is connecting today's leading companies to places beyond it. siemens. answers.

let's talk more about the overall macro economy. pantheon, brown brothers and wilbur continues with us. ian, you've been -- is sanguin a good word? are you questioning that the global economy is on track? >> i'm not as disturbed by some about china. it was a relatively small miss. it's holding up okay. it's not great.

it does now seem to be hitting retail sales. it's a cash flow hit. >> is it payroll or sequester. >> it takes time. it's a big cash flow hit. it takes two, three, four months. >> why did you twitch what i said that? you've been happier than most. i would be dismal too if i was wrong all the time like most economists. >> i hope that's not me. >> no, that's why you're here and the other ones aren't. >> i was about about the industrial improvement, about the rebound in bank lending. that was really pushing support into the small business sector, which is half the economy. payroll tax increase and th

sequester. that's 1.5% of the gdp. the markets decided it wasn't going to happen. that worried me. that was unrealistic. now we're starting to see a bit of a rethink. maybe there is something here. europe still stinks. >> mark, one of the reasons i wanted to talk to you today is so you could explain the rationale behind gold selloff and japanese central bank policy. can you? >> i don't know. the selloff in gold, emerging markets is all related to what's happening in japan. that would be the center of the story i would tell. >> that's what i've got to hear. explain like you would explain to your daughter. >> they were betting the japanese would buy assets in

large size. we found out last thursday was japanese were not only not buyers but they were large sellers of foreign bonds in the first opportunity after qe. as people bought back the short yen they had to get out of the other part of those trades. remember, people were short the yen. long, emerging markets. short yen, long gold. gold and yen returned record highs. this thing sort of snowballed given the market positioning. >> i knew you would be able to do that. >> pretty good. >> in your view, it's not china. it's japan for gold. >> yes. i would have the cyprus story as part of the story. i think ian was right, or former guests were right. people are concerned that cyprus may have to sell some gold. but nothing is clear yet. they won't end up selling the gold but using it as collateral.

so hold on to the gold and in effect leverage it. >> i'm still working on -- so they had to buyback their shorts in the yen. and to get the money to buy it back they had to buyback gold. equities too? >> i would say short yen and long everything else. it's a snowball with stop losses. >> where are you for the the year now? >> growth. >> for gdp? >> well, it's not going to be two, i hope. >> it could have been three and a half. >> it will be next year. next year it will drop to more or less nothing. the big fiscal tightening is taking place. >> next year. >> i know. it's terrible. next year really is the next year. we've got no more fiscal it next year i hope. >> okay. the obama budget has a trip dollars more in taxes.

here you are worried about 40 billion dollars. >> it's trillion over 10 years. ain't going to happen anyway. >> a million over a year. >> it's not going to happen. >> no, it doesn't. it's a big negotiation. it's going on for quite some time. >> thank you. i asked you specifically your currency. thank you. when we come back, the focus on any new information on who was behind the tax. the latest details right after this. embraced a new role. working behind the scenes to provide companies with services... like helping hr departments manage benefits and pensions for over 11 million employees. reducing document costs by up to 30%... and processing $421 billion dollars in accounts payables each year. helping thousands of companies simplify how work gets done. how's that for an encore? with xerox, you're ready for real business.

coming up next, earnings from goldman sachs and cloak khra. green arrows across the board. 9 tragedy in boston. dow opens 57 points higher. s&p up five points. nasdaq up a little over 10 points. this is the latest on the bombings. three people are now officially dead. 126 patients being treated at six boston hospitals. they chased bomb scares around the city. it is a jittery city. they are combing through debris

overnight. they went to a suburb answer apartment building, interviewed two men. they issued alerts for a rental van is and a man leaving the scene at the blast. ♪ [ male announcer ] every car we build must make adrenaline pump and pulses quicken. ♪ to help you not just to stay alive... but feel alive. the c-class is no exception. it's a mercedes-benz through and through. the 2013 c-class. starting at $35,350.

the 2013 c-class. welcnew york state, where cutting taxes for families and businesses is our business. we've reduced taxes and lowered costs to save businesses more than two billion dollars to grow jobs, cut middle class income taxes to the lowest rate in sixty years, and we're creating tax free zones for business startups. the new new york is working creating tens of thousands of new businesses, and we're just getting started. to grow or start your business visit thenewny.com

we are waiting for goldman sachs and coke. it was indicated higher. it's less clear now. closes 253.86. i did see trading on word that the company beat us. just under $4 trillion. coke is out. coke is reporting. we're going to look at case volume and everything else. looks like the the adjusted number is 46 cents a chair versus expectations of 45 cents. >> gown from 11.4 billion in the

year ago period. now, we're also going to give you all of these case volume estimates and we'll try to figure out all the different parts of the world that we're looking for. worldwide looking for case volume up 3.1% in north america. the company says for the first quarter it was 4%. first quarter 4%. >> there's a big announcement the company put out 10 minutes ago saying they are taking steps with five of the bottling partners to try to change the way they set up the beverage partnership model in the united states. they're calling this 21st century beverage model. it means they will be granting

new expanding bottling company. squire coca-cola usa, cloak qaa bottling company high company. >> eurasia up 15. >> i had diet coke and pep sa as well. >> eurasia up 1. >> latin america four below. a mix but overall 4% was above expectations. it's up 62 cents.

it should help the futures at this point. >> investors searching for answers in yesterday's bombing in boston. >> good morning, andrew. we're expecting a big day of beefed up security across the country in response to the events in boston yesterday. we have the emancipation day parade expected to go on today. they are going to beef up security at the parade. we can expect to see public gatherings and event witness stand large numbers of people across the country today. the fbi has taken the lead on this investigation as to what happened in boston yesterday. the white house says the president was briefed overnight

last night. he's expecting further briefings this morning from the fbi. we are expecting that at about 9:30 this morning the media will hear from the fbi as well and we may get more information yesterday during these attacks. in the aftermath the president came out and talk to reporters and offered a note of caution. >> we still do not know who did this or why. and people shouldn't jump to conclusions before we have all the facts. but make no mistake, we will get to the bottom of this and we will find out who did this and why they did this. any responsible individuals, any responsible groups will feel the the full weight of justice. >> so far the leads being made public are very thin at this point. no apparent claim of responsibility for the attack in boston. the pakistani taliban issued a statement saying they were not

responsible for this attack. they did not say in the statement who they believe was responsible for the attack. a massive federal response under way. >> before we go, two things. let's clarify. we had a conversation early in the hour about cell phone use and the possibility of this being used, wireless detonation. >> right. >> and some reports which were erroneous that at&t and verizon shut down the network. what do you know about that? >> the carriers shut down service in order to prevent any remote detonation of further devices. we know it's a tactic. ieds have been detonated in afghanistan and iraq. i talked to verizon wireless and at&t. both denied they had any

shutdowns. both told me they were beefing up their cell service in response to these attacks. they advised people were trying to call boston use texts rather than voice. >> eamon, thank you for clarifying. >> goldman stock up $2 after the company not quite the way it used to be but pretty darn good. they used to blowout numbers. 4.29 the first quarter versus 3.88 on $10.09 billion. >> beats revenue at 9.7. 6.72 billion.

it was 36% higher. you have the tier one, basel and all of this other metrics coming back. it was 7% lower, 3.22 billion. >> they talked about how they're pleased. this is interesting. we have heard from the big financials as they have been reporting earnings. potential for macro economic stability was felt in the quarter. they said they're going to continue to be focused on controlling our costs. they don't expect the turn. >> one other point to learn. >> it was a good call given where this came out. they were looking at one of the

big numbers is the investing and lending number. it includes goldman sack's stake in icbc. the revenue $2.07 billion, much higher than people were expecting. a lot of folks on the street. >> 50% lower. >> shall we talk about it? it's always the topic people enjoy. some people on the street. you. >> me and other people. >> all right. go ahead. >> other people somewhere are talking about it? >> how do you know other people are talking about it. >> it is always a point of

discussion in shotter. >> how much do these sleevy self-serving bankers pay themselves. >> the ratio, though, people always do focus on this for the first quarter 20123 13 was 43%. >> they pay themselves the same even though they made a little more. >> it's all a zero sum game. where are the poor people that all of this money was taken out of. do they live in all inner-cities in are they mostly all around the country? sort of divided equally, the misery caused by this oversized -- all right. >> thank you. anyway, across the board people will pay attention. >> gretchen is writing something right now for the saturday "new york times". >> sunday. >> all bunched up.

you can see the dow component is indicated by 3%. when we come back, a direct track record to prove it. oscar schaeffer is the chairman. he will tell us why he thinks the stock market will resume rallying today. >> here are the results of our facebook page. coke earnings better than expected. 46% of you got it right. so that's less than half of you got it right. coke is a dow component.

are you still sleeping? just wanted to check and make sure that we were on schedule. the first technology of its kind... mom and dad, i have great news. is now providing answers families need. siemens. answers. investors could lose tens of thousands of dollars on their 401(k) to hidden fees. is that what you're looking for, like a hidden fee in your giant mom bag? maybe i have them... oh that's right i don't because i rolled my account over to e-trade where... woah. okay... they don't have hidden fees... hey fern. the junk drawer? why would they... is that my gerbil? you said he moved to a tiny farm. that's it, i'm running away. no, no you can't come!

[ male announcer ] e-trade. less for us. more for you.

welcome back, everybody. if you are just he getting up to speed this morning, here is the latest at the boston marathon. three are dead. 126 being treated.

investigators still combing through the debris. pete williams reports that investigators know for certain this attack involved just two bombs. several other packages were deemed suspicious. it is coming from nbc pete williams. a senior law enforcement official says it appears there were two unbloweded devices. just two that went off. police are studying surveillance to see if they can see anybody with packages where the bombs went off. there is a video of someone carrying two backpacks but it is too early to know whether that was related to the attack. >> social media played a huge role in the last 24 hours. the aftermath of the bombings at the boston marathon. boston police confirmed the explosions in a tweet at 3:39

p.m. eastern time and provided updates and subsequent tweets throughout the afternoon and into the evening. i'm not sure this had been done before. witnesses sent updates as people around the country followed the attack. and foursquare was actually running in the marathon, the ceo. i'm okay. about 20k of us in coral just before mile 26 marker. the hashtag spiked after the attack. and google set up what's called a person finder page for the marathon sphoeexplosions. it was used in a couple other substances the past several years. >> there's a lot of information. that's how i found out about it. but also some bad information. you have to be careful with those things. >> futures were up 90. fair value is 20. coke is now up about 1.20 or

1.30. it may trade at an all time high. we're getting another dow component in johnson & johnson, which if this is a good number this could help the dow. i'm seeing 1.44. >> better than expected. >> four cents ahead of expectations. now, the company is also saying -- it says reaffirming. i don't know if they have done it already. they're affirming their 2013 full year view of 5.35 to 5.45 for the full year. and i don't have a full year street estimate. but it's a narrow range. >> 5.39. >> only 10 cent spread on what they're talking about. i didn't see the revenue number. i see a sales number. u.s. sales $8 billion.

>> 17. >> 17.5 versus 17.42. >> is that a real quote? it hasn't traded yet. let me just check. 82.01 to 82.75. that is indicated higher. we look at the dow futures. coca-cola in the mix. blackrock had a good number. gold man sacks had a good number. we're up 53 points or so on the open. are we going to sneak in a break? >> we will sneak in a break and come back. >> you're going to get much more famous now. >> i sure hope so. >> oh, it's going to happen. and at the top of the hour, the former director of the national counterterrrorism center about yesterday's horrific events in

boston. ♪ [ construction sounds ] ♪ [ watch ticking ] [ engine revs ] come in. ♪ got the coffee. that was fast. we're outta here. ♪ [ engine revs ] ♪

♪ [ female announcer ] you're the boss of your life. in charge of long weekends and longer retirements. ♪ ask your financial professional how lincoln financial can help you take charge of your future. ♪

welcome back to "squawk" this morning. the rally yesterday. oscar schaeffer chairman joins us with his marketout look. good morning, oscar. >> good morning, andrew. >> we did have sort of a pull back. i don't know what you want to call it the last couple of days.

we had pretty good earnings reports this morning both from goldman, j&j and coke. >> i try to tune out the day-to-day stuff. it goes up a lot. and i think the market was down before. you can't tie it together. in 1982 there was a cover of business week that talked about the end of equities. and i think that same apathy is now with most individuals. and i think we're in the second or third of a long-term bull market. i'm not a macro. i just think stocks are the best place to be. the united states is the the best place to be by and large. >> all still a function of the fed? >> how much fed is in your thinking? >> first of all, there's been a

lot of studies about gdp. china did all right and the market was down. that's the way you make money long term. >> no crab drivers -- if you say you're on wall street, they don't care. >> 20 years ago they did. >> i know. what was it? there was another number last week? new highs and 19% or 20%. >> what happened is all these great institutions that have had big pond exposures are sitting pretty. they look in the rear-view mirror. and i think eventually the interest rates will go up. i think when people see they don't have good income the cash

on the sidelines. >> peter lynch and buy and hold, most people were 100% sure buy and hold will work and you will make money eventually in the stock market. that's not the case today. it probably is, the whole idea of buying whole is people don't believe in it. >> right now it's much more short-term orientation. right now i think buy and hold. >> people no longer believe that after -- and it used to be just every person you talked to would say yeah. i hope for the long term. >> well, everybody's attention span is getting shorter and shorter. >> some people never went into the market after the great recession. >> blackrock made interesting

comments. he is seeing it with investors. the bond market is no longer a safe haven. he says it is starting to push money into equities. do you think that's the case that eventually it trickles down and trickles through. >> people are scared to death about long-term fixed income. they know it's eventually going to turn. and if the u.s. 10-year treasury went back to its average field we go down 23%. 10-year treasury. >> 23% of the bond market. it is crazy. oscar? >> one of the stocks you like is directv. i want to raise this issue in part because the other big competitor in the market is dish making this bid for sprint. how does that impact directv? does that change your thinking? >> i will segue into what

charlie ergen did. people focus on it as a domestic company. the growth we all know is slow, if at all. what they are missing if they have huge cash flow for the business. they will shrink 13% this year. it is only 30% penetrated. ergen doesn't have that. what i think will happen is, first of all, you have to get thefinances. you have to get the competitors to drop out. >> what would be more impact on the company? >> i don't know. >> there is a view that charlie

unto himself is trying to put his own company into play, which is actually just by trying this transaction somebody like at&t or verizon comes in to take out dish. i heard on the street column talks a little bit about this. >> that's interesting. you said part of the reason is it's hard to see charlie ergen. >> i've been in the business 50 years. it's important to get the capital allocation, frankly i don't want to talk to investor relation unless i can see the ceo. >> my guess is twitter right after the show. >> no one will say no since you've been on. >> in a world where we're supposed to have fair disclosure. >> first of all, he's not going to tell me about the next quarter primarily because i

won't ask him. i will say where do you want to bring the company? and if he doesn't have a sense of humor i rarely buy the stock. >> oh, you're not going to like him. thanks for coming in. up next, the latest on the boston bombing. and key economic data that could move the markets. there we are again. up 87. this is for real this time. step seven point two one two. verify and lock. command is locked. five seconds. three, two, one. standing by for capture. the most innovative software on the planet... dragon is captured. is connecting today's leading companies to places beyond it. siemens. answers.

welcnew york state, where cutting taxes for families and businesses is our business. we've reduced taxes and lowered costs to save businesses more than two billion dollars to grow jobs, cut middle class income taxes to the lowest rate in sixty years, and we're creating tax free zones for business startups. the new new york is working creating tens of thousands of new businesses, and we're just getting started. to grow or start your business visit thenewny.com

terror in boston. city on alert as officials try determine the origin. market reaction still ahead. several key earnings reports out this morning. we will look for the results through goldman sachs and dow components. coca-cola and j&j. >> cpi hit the tape at 8:30 eastern. the third hour of "squawk box" starts right now. welcome back to "squawk box" on cnbc. i'm joe kernen along with becky

quick and andrew. ceo of w.l. ross, wilbur ross. wilbur will be with us for the next hour. suddenly the markets are looking a little bit more solid with j&j up a tkhrafrplt coca-cola could trade at a new high. and blackrock as well. >> good earnings all the way along. index futures you will see equity futures have -- up 88 points. it was just below 50 points. gain and bounce back for that. what you will also see if you watched in asia there were declines. nikkei down 0.4%. in europe this morning it's been kind of following the same track that we have been watching here in the united states. as things improve, red arrows

diminished greatly. >> they're back off. >> they have agreed not to make a purchase that would cause them to own more than 10% of dell's shares. icahn and the entities agreed 24e8 maintain ownership below 10%. >> i was thinking he owned 6%. >> they have agreed he will not purchase more than that. i'm not sure what that means other than to say he's on the sidelines. it allows them to hook up with blackstone or somebody else. part of it is trying frankly to try to sideline carl, to put him on the edges of this conversation. >> this is that he will not enter into agreements with other shareholders who would

collectively own in excess of 15. so he can't team up. >> this puts him in a box. >> i don't know why he would agree to that unless there are some other terms of the deal we don't know about. we will continue to follow this. this is just crossing the wires. we are just about 90 minutes away from the next update on monday's explosions at the finish line of the boston marathon. here's what we know so far. two explosions, two bombs killed three people, including an 8-year-old boy. 126 patients from the blast are being treated at six boston hospitals. nbc's pete williams say investigators know this attack involved just two bombs. several packages on the street were deemed suspicious and destroyed. there were conflicting reports whether investigators found two unexploded bombs. this morning a senior law enforcement official said it

appears there were two other devices, just the two that went off yesterday. they say there is video carrying two backpacks. our cnbc senior correspondent joins us from boston. scott, you've been talking to people there at the scene. we're waiting to hear more about what to expect. >> good morning, becky. much of downtown boston, including parts of the financial district, are shut down today. this is normally the day after a holiday. patriots' day. the day after the marathon. a festive day. all of that destroyed in the pays of less than a minute when two bombs blew up just before 3:00 eastern time. as the biggest throng of runners getting prepared at the boston marathon. as you said, three people dead and a number of injuries, many

of them horrific injuries. people who were trance parted to several hospitals. more than 100 people. for the runners who were coming up to that scene, normally approaching the height of personal achievement, all of that changed in an instant. >> i thought for a split second, is this a cannon thing? is this a new ending? i thought it was a cannon. then when the second explosion went i knew immediately it was a bomb. and everyone ran. >> here's the latest. hospitals, as we said, dealing with very severe injuries. the death toll stands at three right now. we will see because we are still less than 24 hours. national guard troops here in downtown boston. as you heard the report, no unphroeded bombs.

just the two. unexploded bombs would have been a big break through. a saudi national's home was sevened. he was someone brought in for questioning, was seen near the site of the explosion. he may have been an innocent by stander. however, they carried out a search warrant at his home. the big question is who did this? why did they do this. domestic terrorism or something like that? and how in fact, did it happen that terrorists were able to operate in plain sight. >> we were talking about social media, twitter, facebook. a lot of reports were circulating. and i know you are going to hear resumes flying around that seemed like it was amplified yesterday with a lot of bad reports that had gotten out. spent a lot of time trying to figure out and separate the truth from the rumors on that.

>> we always take it with a grain of assault. even the official reports that come out immediately after something like this. people start to talk, people start to speculate. and the officials that are giving out the information often don't have the full range of information. by the time they got to the press briefing they were saying very little and pulling back on some of the things the officials were talking b. as you said, we have a press briefing coming up 9:30 eastern time. presumably we'll know more. and presumably the information will become more reliable. >> and you say, okay, it was -- the house that was searched was apparently of this person that you're talking about. and reports that several large banks that police were seen walking out with several large bags. you said it looks like he may

have been an innocent by stander. where is that coming from? >> nbc news sources. he was seen around the scene. somebody reported him. police most certainly questioned a lot of people. >> right. >> remember, this is the end of the marathon. so runners and so on have their personal effects that are there. so there were certainly a lot of packages around there. >> it's just weird. it's just weird. it sounds like it could be profiling. they see a saudi guy. was he doing anything suspicious? you know what i'm saying? it's weird that you would focus a person when there's thousands of people around. it's bizarre.

hopefully it's not just an example of profiling. >> well, yeah, absolutely. i don't want to get into the speculation. we know somebody saw this person acting suspiciously. and there were also reports that there is, as i think becky mentioned earlier, potentially some video of somebody. may not be this person. presumably we will find this as we go along. somebody was kind of walking around acting suspiciously. maybe they saw somebody depositing these packages somebody. but a whole lot of analysis. the thing that is pretty strike building this, it is such a public scene. there are so many cameras, whether sraeur lance or tv cameras. they're going to have a lot to go through. and clearly whoever did this still knew they could get away with it. the question is, how did they do it?

>> back to 9/11, back then acting suspiciously, all that really meant -- sometimes all it meant was being middle eastern. just guys talking on planes or a toll booth, i remember. that was deemed suspicious. i'm just wondering what happened this time. i don't know. >> it also makes you wonder was nobody monitor something seems to me the most useful thing for surveillance is to have somebody monitoring. >> they must be doing that, scott, don't you think? >> you would think so. they will certainly be looking at it afterwards. but that's a big question. you know, there clearly was a failure, a breach here. and there will be time for shorting that out after the shock subsides. but you have to ask at an event

like this, we're accustomed to heavy security. how did they manage to do this. were they that smart or was there a massive failure. news out from target. the company is providing first quarter and full year guidance. stock is trading down. they're talking about earnings per share of 1.10 to 1.20. they warn that the gap number is going to be 28 cents below that because of losses when you're looking at recognized and interest expense that related to earlier debt. and some other issues are through that. they are saying this will impact the full year. the number they're talking about when you look at adjusted gap number is 4.28 to 4.48. street was 4.57.

so stock is trading down. looking really quickly to see if they say anything about the sales segments. it's not necessarily sales that will be hurting this. >> we could have expected them as seasonal. >> softer than expected sales, right. weather sensitive categories. >> bathing suits have been on sale at target for at least six weeks. >> on sale. >> waiting. do you go half price. >> i was surprised. it was so cold and they already had bathing suits. >> wait until august. is that what you do? i'm going to come for you for really knowing. because you know how to play this stuff. i'm thinking of buying ski boots now. let's give you a recap on earnings. a number of different reports. a major bank and two dow

components out with quarterly numbers. goldman sachs earnings 4.29, 41 cents better than expected. coca-cola beating the street by a penny. revenue and case volumes better than expected. you're seeing the stock in premarket action. johnson & johnson. four cents above consensus. one other note about dell entering into the agreement with carl icahn. i have read through and also talked about somebody who seeps to understand what's going on. it limits carl icahn's ability to buy 10% of the company. however, they have given him a waiver so he can talk to other shareholders. the goal here is that he could work with blackstone or southeastern or somebody else.

section 203 designed to impede in adequate tender and exchange offers and provides stakeholders from acquiring shares of corporation not be able to engage in certain business accommodations. their hope of course is it prevents him from making a hostile bid or having too much influence if you will, but at the same time being able to talk to others. >> could they participate in a household bid. >> he can't own more than 10% of the company. i'm not sure that would present it. >> more on the investigation into yesterday's bombings in boston. joining us is the national counterterrrorism former director. michael, we were talking

earlier. it seems there are more questions than answers. knowing how these work and how situationings develop, what is it you can say with certainty? >> you can say with certainty there's a lot of uncertainty. the investigation will be quite extensive the next 12, 24 hours looking at the videotape and the forensic evidence from the bomb site. what we will move into is the much longer, deeper, investigative phase. it will take place really around the world trying to look at all the intelligence we had and collect additional intelligence to get a better sense of who is behind this. >> does it get more difficult

the further we get from it if we don't have someone we think is a likely suspect? what does that mean? >> well, not necessarily more difficult. if you don't have an early break it will probably be a longer investigation. these things can go in so many different directions. it's not uncommon. we will probably face a flurry of people who do take responsibility for this. again, right now, i think the net has to be cast very, very widely. so they will be talking to a lot of people. a lot of leads will wash out quickly. just looking at that videotape, there aren't people watching all that video. it's not just one camera. hundreds of cameras go to the city of boston and different businesses. so collecting all of that data, getting through that data and trying to slowly connect those dots it's going to take some time.

>> were you surprised that the taliban put out an announcement they would not responsible? >> not entirely. generally an organization that are in line with larger governments and institutions like the taliban will usually say something along the lines of we didn't do it but the americans deserve it. given the sensitive nature of what's going on in afghanistan, potential for further talks, it doesn't entirely shock me they have denied responsibility. again, i think we will see people take responsibility who didn't do it. if we're lucky, somebody who claims responsibility will actually have been the one who did it. >> michael, thank you very much for joining us this morning. >> thank you, guys. >> coming up after the break, wall street taking extra precautions after yesterday's bomb anything boston. live from the new york stock exchange coming up next.

but we can still help you see your big picture. with the fidelity guided portfolio summary, you choose which accounts to track and use fidelity's analytics to spot trends, gain insights, and figure out what you want to do next. all in one place. i'm meredith stoddard and i helped create the fidelity guided portfolio summary. it's one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account. transit fares!

as in the 37 billion transit fares we help collect each year. no? oh, right. you're thinking of the 1.6 million daily customer care interactions xerox handles. or the 900 million health insurance claims we process. so, it's no surprise to you that companies depend on today's xerox for services that simplify how work gets done. which is...pretty much what we've always stood for. with xerox, you're ready for real business.

welcome back, everybody. the picture has been improving for the equities markets. the future for the dow indicated up 115 up fair value. s&p up by 10. when we first started things

this morning we were looking at gains for less than 50 points for the dow. we have continued to get earnings reports that are better than expected. >> bombings in boston yesterday lead to go extra security. jackie deangelis joins us with more. jackie. >> good morning, andrew. well, it's not just across the country but it's even worldwide. security measures are being stepped up in response to those attacks in boston. city authorities of course are deploying several different measures to step up security in man hot hat ton. manhattan. they travel in packs with lights and sirens. it's the highly trafficked areas they're worried about. rockefeller center, world trade center. mayor bloomberg said the city is fully prepared to protect the

city and its inhabitants. he said security measures will be visible in some cases. in other cases they won't be. here at the new york stock exchange strict security is always in place. i can tell you the feeling is tense as a result of what we saw yesterday. many of the people who live and work down here remember 9/11 as if it was yesterday themselves. >> honestly, i was here at 9/11. it's just part of the world we live in now. >> taking extra precaution, looking around, always making sure surroundings, know what's going on. i'll take the the subways but with an extra eye. >> later today 12:30, mayor bloomberg and ray kelly police commissioner will hold a press conference. they will update us on security measures and address the measures we're looking at specifically in new york city. >> thank you for that. i'm sure we will be back with

more updates throughout the day. >> coming up, breaking news on inflation and housing. march cpi. we're going to go through goldman sachs report with analyst. tite for risk. tite for risk. you can't say 'one size fits all'. it doesn't. that's crazy. we're all totally different. ishares core. etf building blocks for your personalized portfolio. find out why 9 out of 10 large professional investors choose ishares for their etfs. ishares by blackrock. call 1-800-ishares for a prospectus, which includes investment objectives, risks, charges and expenses. read and consider it carefully before investing. risk includes possible loss of principal.

tdd# 1-800-345-2550 when the spx crossed above its 50-day moving average, tdd# 1-800-345-2550 i saw the trend. tdd# 1-800-345-2550 it looked really strong. tdd# 1-800-345-2550 and i jumped right on it. tdd# 1-800-345-2550 tdd# 1-800-345-2550 since i've switched to charles schwab... tdd# 1-800-345-2550 ...i've been finding opportunities like this tdd# 1-800-345-2550 a lot more easily. tdd# 1-800-345-2550 like today, tdd# 1-800-345-2550 i was using their streetsmart edge trading platform tdd# 1-800-345-2550 and i saw a double bottom form. tdd# 1-800-345-2550 i called one of their trading specialists tdd# 1-800-345-2550 and i bounced a few ideas off of him. tdd# 1-800-345-2550 they're always there for me. tdd# 1-800-345-2550 and i've got tools that let me customize my charts tdd# 1-800-345-2550 and search for patterns as they happen. tdd# 1-800-345-2550 plus webinars, tdd# 1-800-345-2550 live workshops, tdd# 1-800-345-2550 research. tdd# 1-800-345-2550 whatever i need. tdd# 1-800-345-2550 so when that double bottom showed up, tdd# 1-800-345-2550 i was ready to make my move. tdd# 1-800-345-2550 all for $8.95 a trade.

tdd# 1-800-345-2550 can you believe it? tdd# 1-800-345-2550 i love it when you talk chart patterns. tdd# 1-800-345-2550 trade up to 6 months commission-free tdd# 1-800-345-2550 with a $50,000 deposit. tdd# 1-800-345-2550 call 1-800-790-3807 tdd# 1-800-345-2550 and open an account, tdd# 1-800-345-2550 now with no trade minimums. breaking news on inflation and the real estate recovery.

forecasters expecting march cpi to drop after last month increase of 0.7%. economists expect housing starts to increase 1.7%. in february we saw an increase of 0.8. right now take a look at the u.s. equity futures. welcome to the new new york state, where cutting taxes for families and businesses is our business. we've reduced taxes and lowered costs to save businesses more than two billion dollars to grow jobs, cut middle class income taxes to the lowest rate in sixty years, and we're creating tax free zones for business startups. the new new york is working creating tens of thousands of new businesses, and we're just getting started. to grow or start your business visit thenewny.com no they don't. hey son. have fun tonight. ♪

♪ back against the wall ♪ ain't nothin to me ♪ ain't nothin to me [ crowd murmurs ] hey! ♪ [ howls ] ♪

welcome back, everybody. we are awaiting what's been happening in boston. we know we are just one hour away from when we will be getting an update on what's been happening. the press conference that's going to be held. in the meantime, here's what we know right now on the situation in boston. three people are dead. 126 patients are being treated from the blast at six hospitals in boston. also, investigators have been combing through debris. conflicting accounts all night about how many explosions and explosive device were out there. we can tell you nbc's pete williams is confirming there were only two explosive devices. there had been mixed reports all night long about this.

there were reports there were additional bombs. there were only two. an fbi news conference coming up at 9:30. we are a few seconds away from housing starts and cpi numbers. rick santelli is standing by at cme. rick, take us to the numbers. >> and the survey says, down 0.2 on headline cgi. strip out food and energy, up 0.1. both numbers lighter than expectations. year over year closed expectations. 1.5 headline. 1.94. housing starts. hey, hey! we're over a million. 1.036 million units. last month revised to 968,000. we haven't been above a million since '08. yeah. let's check it out.

last time over a million was june '08. that's up 7%. if we look at permits, they were a little light. that's a little bit of a disappointment. we were looking for close to 950,000. we ended up with 902,000. but cpi light. housing starts a bit heavy. the preopening equities are better. with the big reversal after the horrible terrorist attack yesterday in boston we see yields. we are under 1.70. now 1.73. back to you. >> bob is the chief economist at fao economics. numbers on the housing starts

look really good. >> well, it's finally about time for us to get a good housing report. they have been on the light side. home builders survey tipping a bit lower. it looks like some of the strength we have had in that sector is losing its momentum. >> what do you think is happening? why? >> i think the economy doesn't have the jobs and momentum to drive housing. it's always been a fallacy to think housing was going to drive the economy. house prices can recover to some extent. # eventually they will rise. mortgage interest rates are low. as they go back to normal levels it will take its toll on housing prices.

banks are rationing credit on high credit scores. i don't think it's a real recovery but a limited recover. >> when we walked in this morning it looked like we would be getting a very minor bounce. at this point the futures are indicated up by 123 points. we have seen them up by as much as 145 points. so is this sort of a relief that there's not more happening here? what do you think is taking place? >> i don't think this is an unusual pattern, becky. very often after big drops like we saw yesterday. obviously from the tragedy in boston often you will see a bounce the next day. so many times we will retrace. on the spx, that 15.52 area is key. we closed just above it yesterday. would not surprise me to see it go back and tested again the next couple of days. again, it's a pattern we see repeat itself time after time. one thing i would like to add on the housing starts is the fact

that the permits were light. >> right. >> the fact that the permits were light, combine that with the fact that the retail sales numbers we saw were a bit disappointing, the employment number we saw, retail sales was the biggest area where people were losing jobs. we could have problems because people spend money on the value of their homes are the two biggest things that drive consumer confidence to keep spending. >> is that why they sold off yesterday. do you think there was something else going on where somebody got caught, got in trouble and had to sell other things to make margin calls. >> well, the pattern the way gold traded yesterday, rumors were flying around. obviously unconfirmed. when someone did get in a little bit of trouble and had to have a margin call, and you see a pattern like that it tends to feed on itself. again, there's been this great debate about gold. it's been so high the last year. and we're seeing out of today's

numbers, not really inflation risk. whether true or not there is always the wives tale that you hold gold in times of inflation. we're not seeing any inflationary pressure at all, becky. the need isn't there. the other thing may be people selling out of some commodities to invest in stocks which could be the reason today. >> wilbur, you own stakes in a huge array of companies and sit on a number of boards. what happened tot economy in the united states? what's your guest. >> one month good data, one month bad data. limping along. >> it doesn't sound like the spring spoon people are talking about either.

>> i don't think this is apocalyptic all just worrying and slightly terrifying. >> all right. we'll take that i guess and do what we want with it. that's not a great outlook in terms of where things are heading. maybe not apocalyptic but it doesn't sound like a bill of clean health. >> i couldn't agree more. because what we end up with, if he's right and he's got a darned good chance is a really boring, low growth new normal. but we don't have a real boring low growth debt situation. so we have created piles to fix something we haven't to get mediocre growth after all that. that frames the issues nicely. >> jobless claims will be big this week. what are you looking for on

thursday? >> i think the claims are going to edge back up. i think the the claims numbers have gotten to be too low for reasons not related to fundamentals. easter is always a very difficult period. and what i see is the economy is things are week. the last report. household report. >> i don't see claims getting a lot better. i'm concerned about the potential for job growth. and politicians need to do things in america to grow jobs instead of arguing with one another. really need to focus on jobs. maybe this thing will cause our two political parties to decide they need to work together for america. maybe this isn't going to happen in my lifetime now. jobs are the key to getting growth. the key to that is going to make america a place safe for doing business. i think the focus on redistribution is the wrong

focus. you know, you don't want to have a certain size pizza and cutmore and more slices so everybody can eat. you need to get more pizza. in order to do that you need an environment good for business. and i think they have all lost sight of that. it's not about taxes, redistribution. >> are you looking for a quick fix? >> there's no quick fix to this. there's a very difficult fix to this and things if both sides will have to do that are uncomfortable in the short run. lying about it isn't going to make it better. by saying social security, medicare, medicaid aren't in trouble, is not going to make it better. >> working so well. >> despicable. >> bob, thank you for coming in today. >> thank you. >> j.j., rick, see you soon. thank you. >> always a pleasure. >> our guest host will be with us the rest of the show.

>> very excited this morning. >> tell us what you really think. coming up, more on goldman sack's earnings report. beating the streets expectations by 40%. up next, reaction from financial sector analysts. the one and only dick bove. ♪ ♪ the new blackberry z10 with time shift and blackberry balance. built to keep you moving. see it in action at blackberry.com/z10 ♪

[ laughter ] ♪ [ female announcer ] each one of us is our own boss. ♪ and no matter where you are in life, ask your financial professional how lincoln financial can help you take charge of your future. ♪ transit fares! as in the 37 billion transit fares we help collect each year. no? oh, right. you're thinking of the 1.6 million

daily customer care interactions xerox handles. or the 900 million health insurance claims we process. so, it's no surprise to you that companies depend on today's xerox for services that simplify how work gets done. which is...pretty much what we've always stood for. with xerox, you're ready for real business. welcome back to "squawk". goldman sachs posting quarterly

results of 4.29, 41 cents better than expected. revenues topping consensus. to help us decipher the numbers, dick bove at rafferty capital. good morning, dick. >> good morning. do i have to say anything positive? >> you can say positive, negative. >> you guys have made me cry in the last few minutes. >> why do you say that? >> based on the conversation around the table. >> everybody is so negative. >> first this quarter will be the biggest in banking industry in terms of profits. so far while everybody argues about every number that comes out from banks, every bank that has reported numbers has beat earnings estimates. goldman sachs is coming with the group here. it's beating its earnings estimates. >> maybe that means the estimates were wrong.

>> i guess it does, doesn't it? it means people are a little too negative too. if you break goldman sachs into two numbers, one core businesses virtually all quarter over quarter did well. they were up on the fixed income and equities side. underwriting up. the only core business that didn't do well was m&a. i expect that business won't do that well for the next couple quarters anyway. the investment management business, the contribution from the chinese bank, all those things did poorly. if the core businesses of the company continue to do quite well, and i believe they will, goldman sachs is likely to have a strong year. why are they doing so well? they're doing so well because every major central bank in the world, as you're well aware, is

increasing money supply pretty dramatically. goldman sachs is in the money business. all that money gets converted into some type of financial instruments and they get traded. >> right. >> converting them is underwriting. it is tkraoeufgt earnings of goldman sachs, jpmorgan, citigroup. >> dick, there's a quote this morning in the press release that's getting a lot of attention. he said the potential for macro economic in stability was felt in the quarter and con trained overall corporate and investors activity. your expectations for the next couple of quarters, same issue? >> yeah. i think you want me to cry again. >> i'm not trying to make you cry. i'm just raising the issue. >> if you want to look at the basic core factors if it grows this rapidly it has to go somewhere. it goes to final instruments. and they get traded.

if money is around in huge amounts and the cost of that money is extraordinarily low, then ultimately it's going -- and the stock market is rising, then ultimately you're going to see a significant increase in merger acquisition activity. so the net effect is all of the core drivers that you would look at to try and see where goldman sachs, jpmorgan, citigroup's earnings are going are all very positive. so the net effect is you should see pretty good earnings. >> that's the real economy. let's talk about the stock market. goldman has been on quite a run. your expectation for where it will go? some say it is a little ahead of itself. >> i think it is behind itself. look at bank stocks right now. the big banks are selling at discounts to book value. there's no reason for them to sell discount toss book value for two reasons. number one, in many cases book

value is 100% cash. if you look at jpmorgan's numbers or citigroup's numbers, the net book value is 100%. goldman sachs is selling discount to book value. if you start looking at what's going on in housing and realize what it means as housing prices rise it means the value of the assets are understated. not overstated, which is what everybody has been screaming about the last three or four years. they're understated. book value is understated. these stocks are selling at discounts. now can this happen? these stocks are dirt cheap. >> is there anything to worry about in the regulatory front? there are different taxes coming up on too big to fail we should be thinking about. >> you have a lot of pro chinese

congressman line rahm and vitter. they want to destroy the position of the united states. >> interesting way to frame it. >> well, it happens to be the right way. there are four chinese banks that make more money than any bank in the united states makes. they are growing rapidly. they are supported by the the government. they are showing enormous growth. you have four big banks. all the united states congress wants to do is rip them apart. while the chinese banks are growing rainedly they will take over the global financial system. it's easy for people to understand when someone says china is building a a blue navy and we're putting a third of the fighter planes in the united states on the ground because we don't have the money. everybody understands that but nobody seems to understand what chinese banks are doing to the american banks. >> wilbur ross here. >> do you think regulators would

let a chinese bank take over one of the largest 15 american banks? i don't think so. >> why should? no reason for it to happen. united states pose a billion dollars a day buying chinese goods into china. as a result of that, the peoples bank of china has $3.5 trillion in assets, more than any bank in the united states. and certainly way more than the united states federal reserve. the banks in china are growing at enormous rates. >> we're going to have to go in a second. just on size alone, talk about corporate clients. do you say to yourself the skwraoefs of the world will stop going for loans and say actually i can get one check by the chinese bank. that's the competitive issue here, right? >> yeah. i think it's already happened. i think if you were to contact some of your people at goldman sachs, jpmorgan where do you go

to fund that deal. they have to go to china. what they're not going to say. >> i feel i haven't seen that. >> well, i have. and they say -- they're going to the sovereign funds to get the money. the sovereign funds are china. >> that's different than the chinese banks. dick, this is a good but longer conversation to have. we appreciate your perspective on goldman this morning. we'll talk to you about this soon. >> okay. >> coming up, we'll check in at the new york stock exchange. the stories to watch ahead of the opening bell. tomorrow on squawks box, bank of america's quarterly numbers. plus, csx ceo michael ward will join us to talk about his company's report first on cnbc. "squawk box" starts tomorrow at 6:00 a.m. eastern. zap technology.

departure. hertz gold plus rewards also offers ereturn-- our fastest way to return your car. just note your mileage and zap ! you're outta there ! we'll e-mail your receipt in a flash, too.

it's just another way you'll be traveling at the speed of hertz.

welcome back to squawk. let's get down to the new york stock exchange and jim cramer. >> good morning, jim. >> lots to talk about. we account talk about boston and the impact on the market. i would love to hear your view on the psychology there, but also coca cola there. goldman sachs, j&j, we had good

numbers. >> coca-cola doesn't have to say anything positive and people absolutely lap it up as they've done for all of the consumer products company and everies single one whereas, goldman sachs they just put a single boilerplate line about what everybody knows which is the macro environment and you're supposed to throw the stock out. i think that is a mistake, and i think the book value is for real. j & j is blessed. he's making it better. j & j and coca-cola, andrew, after boston, hey, you what? i'm take them. it's after boston. boston signifies the psychological terror that people feel when they buy anything other than what's in the supermarket. >> we were talking, i think in the 6:00 hour about sort of is this going to be a major psychological shift that people have come out and says not only a huge tragedy, but it will change the way people think about everybody and for as

horrible a human tragedy as it is it will not necessarily change the way people think about buying things in the economy and the markets at large. >> things do fade. airline crashes fade and people buy airlines six months later. we know that, and obviously don't want that to happen. look, some of us, my daughter was a couple of blocks away. wh what am i thinking about? am i thinking about this? you come in and do your job and you kind of get lost in it. my take is that not that long from now you will think that was an opportunity to buy gold that should have gone up in a world where we have not solved terror, and i think that you have to be a little philosophical short term and it doesn't allow you to be philosophical medium term. is there a view on gold? is there a jim cramer view on gold right now? >> i used to liquidate people's accounts when i was at goldman sachs, and i had to fight a liquidation when i was at my

hedge fund. the margin clerk doesn't look what price something is. the margin clerk just sells it because at the end of the day he's fired if he doesn't get rid of the position that he has and etfs and gold comes out and we'll find out in a couple of days who blew up yesterday and then we'll say, wow, you know what? that's what it really was. freeport, when it was in freefall, was there a hedge fund that blew up. we didn't know it and you don't put up a sign and say who blew up here? gold has some value in this environment and a lot of central banks may be selling and i believe the germans will tell the ecb let's sell the cyprus gold and psychologically it is very bad and gold is an alternate currency, and you want our currency? i don't feel like going overseas with it? >> got it. jim cramer, we will see you on "squawk on the street," thank you for that analysis this morning. >> when we come back our guest

host today is wilbur ross. we'll give him the last word. squawk will be right back. you know how to dance... with a deadline. and you...rent from national. because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. this is awesome. [ male announcer ] yes, it is, business pro. yes, it is. go national. go like a pro.

with fidelity's new options platform, we've completely integrated every step of the process, making it easier to try filters and strategies... to get a list of equity options... evaluate them with our p&l calculator... and execute faster with our more intuitive trade ticket. i'm greg stevens and i helped create fidelity's options platform. it's one more innovative reason serious investors are choosing fidelity. now get 200 free trades when you open an account.

welcnew york state, where cutting taxes for families and businesses is our business. we've reduced taxes and lowered costs to save businesses more than two billion dollars to grow jobs, cut middle class income taxes to the lowest rate in sixty years, and we're creating tax free zones for business startups. the new new york is working creating tens of thousands of new businesses, and we're just getting started. to grow or start your business visit thenewny.com welcome back, earn. let's get back to our guest host, wilbur ross for the last word. wilbur, you've been being looking around. every time we talk to you, you

talk about potential things and greece the last time. how do things in southern europe look to you right now? >> they're getting closer to the point in time when people should go in. in a couple of weeks i'm going to spain especially to look at the banks there. >> the banks in spain? >> yeah. i think with some of the false starts that they've had it's starting to come to a real recognition of the problem starting to clean out the bad loans and all this stuff. so i think at some point in here it becomes a good place to be. >> at some point in the near future? >> i hope so, i don't want to keep traveling there for no good vision. >> would you envision doing something like you did in ireland? >> conceivably. conceivably, or greece. greece is starting to get its things together. tax checks are starting to go up in greece. the rough love that the prime minister is putting with the forensic accountants and all that seems to be